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« World Bank debars Odebrecht construction units for fraud and collusion | Main | Huawei, CFO charged in Iran cover up »
Tuesday
Jan292019

What is corruption? Depends on who's looking

For those interested in the study of corruption from the scientific perspective one thing stands out: actual corruption is essentially unmeasurable.

It could also be observed that our imperfect measurements of corruption, even more accurate random forced response surveys, have found only a noisy relationship between perceptions of corruption and its reality.

From the perspective of Niklas Luhmann's systems theory, which replaces the classical subject with an observer, we might ask simply, who is the observer?

Different observers view corruption in different ways, with one describing a particular African nation as the most corrupt while another might describe the United Kingdom as holding the top spot.

For the corrupt such activity is a boon, or at least a self-described necessary evil. We can at least say corruption is a premodern form of patronage that has survived despite having earned the modern distinction of illegality.

One could also view this patronage as various operations of a premodern system of communication now described as criminality. One might say that corruption survives in part as human nature (or as a feature of the social system’s environment as Luhmann might say) despite the differentiation of the modern political and legal systems of communication and the concurrent increase in social system complexity.

Ironically, it is this very differentiation that can be exploited by corrupt actors. The rule of law, to cite one example, can be questioned when it is described as being wielded for political ends, or as we could say, in situations or within domestic boundaries where there exists a collapse of differentiation.

This is why legal authorities in well-integrated jurisdictions are so careful with prosecutions involving political actors; the separation yet mutual interdependence (or differentiation) of modern law and politics demand as much. In less integrated jurisdictions one could say they might be concerned at times with appearances.

To look at one specific example amid this abstract analysis, various observers have described the CFO of Huawei, Meng Wanzhou, as a purely economic agent captured in the wake of a political struggle. Certainly it is unusual for such a high level executive to be arrested for alleged sanctions violations. Still the retaliation by China in arresting two Canadian executives is even more telling when the legal protections afforded are compared functionally.

Based on a recent report by Reuters the available evidence paints a picture (however incomplete to outside observers) of Meng’s arrest as a legitimate exercise of legal authority, or as various Canadian officials (including the Prime Minister) have asserted, support for the rule of law.

Alas, whereas for scientists this may be a matter of theoretical discussion, for compliance professionals this becomes another question of risk, which as Luhmann would agree, remains an omnipresent feature of the modern world.

_____

William N. Weaver, pictured above, received a B.A. in Communication from the University of Pennsylvania before later earning a J.D. from Campbell University law school in Raleigh, NC. He currently works as a compliance analyst for U.S. Bank. The views expressed are his own, and not the views of his employer. He can be contacted here

Reader Comments (2)

Intresting post and good question. J would be very gratefull if You be so kind and make it possible for readers of The FCPA Blog to get acquainted with the text (formula open access, academia.edu) devoted to the essence of corruption in practice, to get a substantive and precise answer

http://www.academia.edu/37741482/Corruption_as_a_net_of_influences_links_and_connections
January 29, 2019 | Unregistered CommenterWaldemar Walczak
William, I found your article most interesting. I spent over a decade working in the field of international trade facilitation. Our role was to reduce corruption in the customs departments of the developing world. We monitored transactions between suppliers (exporters) and buyers (importers).

The elaborate deceptions created to defraud payment of customs and import duties were excellent examples for proving that corruption can only exist when at least two parties collaborate. Collusion does not exist in a vacuum.

Thank you for the work you do to bring these issues to light.
January 30, 2019 | Unregistered CommenterDavid Belden

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